R&D tax credit 2023/24 – are you eligible to claim?

Date: October 26, 2022

R&D tax credits offer generous tax relief for many companies, which can provide a vital lifeline to businesses. This relief can help fund further development in the firm or be utilised in other areas of the business.

We have developed a streamlined procedure to check if your business is eligible to claim R&D tax credits. Please complete the form below or email info@alexander.co.uk, and we can arrange an online or phone consultation, which can take as little as 30 minutes to evaluate if you can claim and discuss how we can assist you.

How much can be claimed?

Eligible businesses can claim back up to 186% of the tax deduction on the amount they have spent on qualifying R&D expenditures.

You do not have to make a profit to claim, as a business that is loss-making can claim a cash payment from HMRC and there is no longer a minimum amount that can be claimed. This means that projects of any cost are now eligible for an R&D tax credit claim. There is also no overall limit to what can be claimed.

Read our guide to find out what you can claim with R&D tax credits.

Why don’t many businesses claim R&D tax credits?

Many businesses do not claim this because they are either unaware of this generous tax rebate, or incorrectly believe that the work they undertake qualifies due to R&D tax credit restrictions.

We work with a diverse range of clients to secure R&D tax credits, including a building manufacturer who created a new style of installable false ceilings and several clients who have developed new software systems.

You may be surprised at how many businesses make claims each year. According to the latest provisional figures from the government, the total number of R&D tax credit claims for the tax year 21/22 was 90,315, an increase of 5% from the previous year. This increase is driven by a rise in the number of claims within the SME sector, so small companies as well as larger firms should check their eligibility.

Read our guide to find out the most recent R&D tax credit changes that businesses should be aware of.

Who is eligible for R&D tax credit in 2023 and beyond?

Companies of any size and operating in any sector can claim R&D tax credits for any eligible project, not just those in science and technology, which is a common misconception.

Companies that qualify must be UK registered, and, from April 2024, the R&D work must be undertaken in the UK (with a few specific exceptions).

Overall, to benefit from R&D tax credits, you must:

Be a limited company in the UK that is subject to corporation tax.
Have carried out qualifying research and development activities.
Have spent money on these projects.

To find out whether you are eligible for R&D tax credits, get in touch with our team who will be more than happy to help you.

Which projects are eligible for an R&D tax credit claim?

Work which qualifies for Research and Development Tax Credit must be part of a specific project to make an advance in science or technology (although the company itself is not required to work in science or technology). Research and development into pure mathematics now also qualifies.

Projects must relate to a company’s trade, or one that the company intend to start up based on the results of the R&D.

Is there a time limit to making an R&D tax credit claim?

Currently, claims can be made within two years of the end of the accounting period following the project’s completion date. However, there is now a requirement for many companies to pre-notify HMRC of a claim, following the most recent R&D tax credit changes from August 2023. Also, the time limit has in many cases been reduced to 6 months.

Companies will be required to notify HMRC, using a digital service, within 6 months of the end of the period to which a claim relates. Companies that have claimed in one of the preceding three periods will not need to pre-notify.

Therefore, it is vital that companies that may have already undertaken R&D eligible work or are considering doing so claim as soon as possible. Alexander & Co can act for clients and notify HMRC on their behalf.

How Alexander & Co can assist with claiming R&D tax credits

R&D tax credits are a valuable tool to businesses. Accurate, trustworthy advice is key to unlocking invaluable R&D tax relief and businesses undertaking research and development activities should not be deterred from using this resource.

We have been successful in securing robust R&D tax credit claims for many businesses across a wide range of sectors. You can be sure you are in safe hands with Alexander & Co. We are regulated by the ICAEW and follow their professional conduct guidelines. The person preparing the claim will also be a Chartered Tax Advisor.

Unlike many companies, we take care of all the processes regarding R&D tax credit claims. This includes conducting detailed analysis and writing all the accompanying reports to support the claim. All we require from a business is typically an hour or two with the relevant personnel, typically the financial director (or equivalent) and a member of the project team. Having dealt with numerous claims across many sectors, including IT, manufacturing and food processing, we are already familiar with the processes of many industry sectors.

With an expert team of qualified tax advisors, you can be sure of accurate advice that you can rely on. With a proven record of securing R&D tax claims, we advise and assemble robust claims for clients.

Get in touch with us today if you would like to discuss how we can assist you. We are happy to provide a no obligation, complimentary consultation to explore the best route forward for your business and check eligibility.

Please email us at info@alexander.co.uk or complete the enquiry form below to arrange a consultation.